Realty prices in Ahmedabad on the up

If, going by Ratan Tata, it���s stupid if you are not in Gujarat, it���s unpardonable for a realtor to ignore Ahmedabad. Land is gold in the city, once known as Manchester of the East. Though Ahmedabad has been a little late in joining the real estate bandwagon, it is fast catching up with other cities with a distinct identity of being a highly attractive business locale. The opening up of the economy in the past decade, development of labour pool, infrastructure and a business-friendly environment has made Ahmedabad one of the wealth-generating hubs of Western India.

According to real estate pundits, land prices in Ahmedabad have seen a 100% rise in the last five years, especially after 2001, when a devastating earthquake shook the state and the foundations of the real estate sector and sent property prices crashing.

Ahmedabad, which was seen as a ���dead��� city with its share of sick textile and chemical units, is today one of the hottest destinations for the pharmaceutical and biotech industries. The textile sector is springing back to life, educational campuses have been set up across the city and even the IT and ITeS sector is fast taking roots.

The quality of urban infrastructure, human resource availability, telecommunications connectivity, better governance and availability of real estate have all had their share of influence on this skyward-looking real-estate market. Property rates in the city have doubled since 2003.

The spurt in the commercial rates has largely been influenced by the growth of organised retail market. The entry of national retail giants like Reliance, Futures Group, Aditya Birla Retail and Subhiksha have not only revved up the retail scene but have added value to the real estate market in the city. Similarly, in the residential sector, the rates range between Rs 1,000 to Rs 2,500 per sq ft (for apartments). The phenomenal rise in real estate prices have also been attributed to the growing number of NRGs (non-resident Gujaratis) who are investing their savings in the real estate market.

According to local builders, about 10% of residential units which are coming up in and around Ahmedabad are being bought by the NRGs. Similarly, the perception of Ahmedabad as a ���relatively safe city��� in terms of law and order situation has also prompted many to pitch tent in the city. That���s not all.

Anticipated investments in the IT and BPO sector in the near future have pushed up the prices of realty in and around Ahmedabad. ���Now all the prime real estate developments is happening in the north-western part of Ahmedabad, towards Gandhinagar,��� says Suresh Patel, vice-president of GIHED, a city-based body of developers, pointing at the hectic construction activities going on in this region.

As many as six IT-ITeS SEZs are being developed over 137 hectares of land in and around Ahmedabad by national players such as DLF, Aqualine Properties and TCS. This has triggered a boom in this region. However, the future of real estate will depend a lot on whether TCS ��� one of the largest IT players in Gujarat at present ��� is able to attract its Indian and foreign peers into the state.The availability of land is also a big attraction for domestic and foreign companies.